Bentley Motors loses 20-year long trademark dispute with family-run clothing store in Manchester

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Background

Both companies have sold Bentley branded clothes for a long time. Bentley Clothing was established in 1962, and registered the Bentley trademark for clothing in 1982. Bentley Motors, which was founded 100 years ago, only started selling branded clothes in 1987 – some 25 years after Bentley Clothing. The Judge acknowledged that for a while, there was “honest concurrent use” of the trademark. Things began to shift once Volkswagen bought Bentley Motors in 1998. At that time, Bentley Clothing approached Volkswagen’s CEO regarding the trademark and put forward a business proposal to him, which was dismissed. Bentley Motors then made a “conscious decision” and concerted effort to develop their clothing range, and began to try to cancel the clothing firm’s trademark rights at the UK Intellectual Property Office.

Decision

Judge Hacon, sitting in the Intellectual Property Enterprise Court, said that Bentley Motors’ focus on its clothing range, following Bentley Clothing’s approach in 1998, amounted to a steady encroachment on Bentley Clothing’s goodwill, and was clearly done on purpose in order to:

“increase the prominence of that sign, but only in incremental stages in the hope that no one stage would provoke a reaction from Bentley Clothing …. It is consistent with an intent to clear away Bentley Clothing’s right to protect the Bentley mark for clothing and headgear and ultimately to extinguish Bentley Clothing’s right altogether.”

The two brands ran concurrently for many years and a peaceful coexistence of trademarks could continue, but only if there is no likelihood of confusion between them. Bentley Motor’s particular approach in this case has proved their undoing. By developing their merchandise in direct competition with Bentley Clothing, and making attempts to have Bentley Clothing’s trademark removed, they have arguably assisted in creating the confusion between the brands, thereby preventing any chances of a peaceful co-existence.

Consequence

As a result of the judgment, Bentley Motors will not be able to use its own name on its clothing range, effectively ending the clothing arm of their business. As well as paying damages to Bentley Clothing, Bentley Motors will also have to either hand over or destroy all remaining clothing it has in stock or is yet to be sold.

Understandably, Bentley Motors are irate with the decision and are likely to appeal. On the other hand, Bentley Clothing’s director Christopher Lees said:

I could either let Volkswagen-owned Bentley Motors take from us what had been my family’s since 1990, or spend 15 years and our life savings fighting them. It’s been ruinous, financially and emotionally, and today’s decision is a huge relief”.

Christopher’s father Bob, 83, also weighed in:

We made a very sensible business proposal to the Volkswagen CEO in 1998, what strikes me most about Volkswagen and Bentley Motors is their lack of good strategic business sense”.

The family said that they didn’t want to sue Bentley Motors, an important British company, in order to protect their long-held trademark rights, but that the dismissive attitude of Bentley Motors had left them with no choice. They also hope that this decision will allow their business to grow again. In the early and mid-1990s, the company generated £5 million a year in sales. This has now slumped to less than £100,000 a year. Bentley Clothing attributes this decline to the focus Bentley Motors placed on its clothing range following the failed negotiations in 1998, and the ‘persistent infringing’ of their trademark that followed.

Comment

This case is a textbook example of the power of being first. Registering first means that even the smallest of companies can prevail against large multinationals. Because Bentley Clothing had the trademark first, and has continued to use it, it has a monopoly over the word Bentley in relation to clothes. However, this is only possible because Bentley Clothing has persisted in the promotion of its business and the Bentley trademark throughout the decades. With trademarks, generally speaking, you have to continue to use them in order to keep them. If it had ceased trading, or stopped the promotion of the Bentley name, Bentley Motors would have had little trouble in taking over the brand name. It is therefore testament to Bentley Clothing’s perseverance more than anything that they have won this victory.

Although supporting the underdog in David v Goliath cases is an enjoyable British pastime, one could argue the outcome in this case is rather counterintuitive – as the confusion amongst consumers will probably continue. Most people in the UK, upon seeing someone wearing a t-shirt with the word Bentley emblazoned across it, would assume that that related to the iconic British car maker.

The Judge said that Bentley Motors, in focusing on its clothing merchandise offering, was encroaching on the goodwill which had been generated by Bentley Clothing. However, I would say the reverse is the more convincing argument. The widespread brand recognition that Bentley Motors enjoys in the UK, and indeed worldwide, encompasses more than just luxury cars, but also a whole range of merchandise that companies of that size tend to produce on the side.

Take Ferrari as an example. If a typical consumer saw the word Ferrari on any object, such as pencil, pair of shoes, or even a type of sauce, the consumer is likely to think that product was in some way associated with the Italian supercar giant. This would be the case despite the possibility of there being an unrelated Ferrari family in regional Italy running a pencil manufacturing business.

In my hypothetical Ferrari example, and with the Bentleys case, the current system does not assist the average consumer in dispelling confusion – it actually contributes to it. This is because the courts will find in the favour of those who registered the trademark first, even if the average consumer associates that trademark with a different (but more famous) brand.